Bengalaru remains India’s fintech leader
WealthTech captured most of the seed funding; Marketplace Lending unlikely to rebound.
Bengalaru retained its crown as India’s leading center for fintechs, capturing over half or 56% of the share of fintech seed deals in the country in Q2.
Of the 27 Indian fintech seed deals in the quarter, 15 were fintechs in Bengalaru, according to data from Fintech Global. Five of the largest deals were of fintechs based in the city.
Overall, the volume of fintech seed deals were 27% lower than in Q1.
The quarter’s biggest deal was that of StrideOne’s, a financial services platform for startups. The New Delhi-based fintech raised $32m led by Elevar Equity. StrideOne said that it plans to use the funds to create more financial products for startups and MSMEs.
WealthTech was the most active seed deal sector in Q2 with 8 deals, a 30% share of total deals in the country. Amongst the top 10 biggest deals, 5 were WealthTech startups. This is a shift from Q1, where Marketplace Lending fintechs captured most of the deals.
Blockchain & Crypto accounted for the second most seed deals in Q2 with five in total.
Meanwhile, the Marketplace Lending sector has likely run its course, according to Fintech Global. This follows after the Reserve Bank of India informed dozens of FinTech start-ups in June 2022 that it is barring the practice of loading non-bank prepaid payment instruments (PPIs) which is the primary method startups facilitate lending.